Expansion Not Expenses: How to Use Licensing to Expand Your Business Without Spending a Fortune

May 12, 20150 Comments

Intellectual property is a strategic resource that can be used in many ways. It can help you break into new markets and distribution channels, often times at a lower cost and higher return.


One strategy is to license out rights to your IP or parts of your IP. It could be a brand extension into non competitive products, or rights to sell your product in new distribution channels or countries. A second strategy is to license in rights to a well known brand and leverage that IP to reach new customers for your products or services.

I had a toy client from Australia that used both of these options to successfully expand their business into the US and Europe. I helped them acquire rights to some big well known kids brands. They applied these brands to their new toy products and sold into all the major US toy retailers. It also saved them significant promotional money because these brands were popular TV shows that kids viewed every day.

Because they were a small company, they didn’t have the resources to expand internationally. They leveraged their success in the US and licensed out rights to their top selling products to toy companies in other countries.

Licensing is also a great strategy to differentiate your product in the market, especially if its a “commodity”. When I was licensing the Batman movies, a small bike company approached me to get a license. They wanted to expand sales and needed a way to break into mass market retailers, such as Walmart. Kids bikes were pretty generic, low cost low margin products in a very competitive and promotions intensive market.
When the movie opened, they were the only “movie branded bike”, and their sales skyrocketed. They got orders from every mass market retailer scrambling to fill their shelves as demand for movie related products soared.

In today’s competitive market, licensing is one of the best low cost high return ways to expand your business. Rather than spending time and money “building” a market, you can license out some or all of your IP to companies in different markets and industries. Acquiring rights to an IP saves development time and dollars, letting you focus your resources on what you do best – selling and making money with your products or services.

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About the Author ()

Rand is President / CEO of Licensing Consulting Group, an intellectual property management and licensing company specializing in assisting clients in IP Management, Strategic Consulting, Acquisition of Licensing Rights, and Property Representation. Rand has licensed some of the biggest Hollywood blockbusters, including “Batman” and the “Mighty Morphin Power Rangers”, both of which generated billions of dollars in worldwide merchandise sales. He has lead various international licensing programs as both licensee and licensor, and through consulting projects focused on licensing strategy, brand development, sponsorship sales and property representation.

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